Important : Query regarding vendor return process with return PO (without outbound delivery)?

[former_member805066]

Hi SAP Consultants ,

I have a " logical query "as mentioned below :-

1.) Scenario : In a vendor return process with return Purchase Order and without outbound delivery , We created a return PO and a Goods receipt (MIGO) with movement type 161 (with ref to return PO) for the goods to be returned to the vendor.

Now my question is,

Why do we need ( logic behind the action ) to post a credit memo (with reference to the return PO via MIRO) to the vendor ???? ........here we are actually not dealing with any invoice in this scenario and its just creation of a return PO and a Goods receipt (MIGO) with movement type 161 to return the material to the vendor (whatever be the reason for return like poor quality , damaged goods etc..)

Also to add certain details regarding a Credit memo as defined by SAP - " The term credit memo always refers to credit memo from the vendor . A credit memo is used to correct the purchase order history if the quantity invoiced is too high or if a part of the quantity invoiced is returned to the vendor"

Now here , from the above definition mentioned , there must be some invoice posted against the materials stored in the plant/storage location for the credit memo to be issued to the vendor  with ref to return PO via MIRO transaction ???? ....can we post a credit memo without any invoice posted previously against the items ???....

Please suggest logical conclusions to this query. Please specifically point out any logical flaw in the statements mentioned above by me with correct reasoning against it.

Looking forward to your responses.Quick responses are appreciated!!!

Regards,

Sanket Kumar

SAP MM Consultant

[Prasoon · Accepted solution]

Hi,

   Credit memo is required for return po if you hav already paid to the vendor for the goods and you want to get the money in return of goods.

hope its clear and helpful.

Regards,

AKPT

[former_member187965]

Hi,

It's not only the process or definition of credit memo, think from business & accounting point of view.

When you purchase material from vendor, you pay to vendor. Now, when you return rejected material to vendor then vendor should pay to you. So, credit memo is required to recover the amount of rejected quantity from vendor.

Below will be the accounting entries,

At Goods receipt,

Stock a/c....Debit

    GR/IR a/c.....Credit

At invoice receipt,

GR/IR a/c.....Debit

    Vendor a/c....Credit

At Return PO GR (161 mvt type) or Return delivery (122 mvt type),

GR/IR a/c.....Debit

    Stock a/c.....Credit

At Credit Memo,

Vendor a/c......Debit

    GR/IR a/c.......Credit

From accounting point of view, if you don't post credit memo for a return PO then the 'GR/IR a/c' which is 'Debited' at the time of 'GR (161 mvt type) against return PO' will remain open and it is not accepted by accounts. Hope this will resolve your query.

[Former Member]

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[Former Member]

If you don't want Invoicing part, do not create return PO. Simply use a 122 movement type (vendor return).